Over the past three years, Gramhal experimented with multiple solutions, each informing the next. We believe in rapid iterations that incorporate feedback from the community and fall at the intersection of impact, sustainability, and scalability. Our latest product is called Bolbhav - a WhatsApp chatbot for farmers to access hyperlocal information on crop prices, crop advisories, and weather, crop quality knowledge, and more. This information is sourced through open-source big data. Since it’s launch in October 2021, the chatbot has answered 5 million queries from 250,000 farmers.
Gramhal’s journey up till here has been equal parts challenging and insightful. When designing Bolbhav, the following learnings were our guiding light-
1. Information is powerful and can make the local ecosystem efficient
When we provided warehouse financing, farmers would come to our warehouse with a few kilograms of grain and ask us about the quality of their produce. Upon quality inspection, they inquired about the price they would receive if they decided to sell it to us. We offered them tea and let them know the spot price as per their crop's quality. They would have the tea, engage in casual conversation and then go away. This started happening daily and farmers started using us as an information source. They used this information as a negotiation tool during sale with the buyers to whom they had been selling their crops for decades. Farmers received the price we quoted, but from buyers in the local system. We noticed similar patterns of farmer behaviour (use information we provide to negotiate a fair price), when we provided doorstep quality inspection service and personalized price information.
We were quick to realise that for farmers, access to information is powerful in ways more than one.
2. Farmgate level information can huge bring immediate gains
The farmgate sale (where the produce is directly sold from the farm or the village) is the weakest link in the whole agriculture supply chain. In a simplified version of the agri supply chain, we have three players between farmers and industry – village level aggregators, traders, and brokers. Both traders and brokers run their business on thin profit margins, in most cases, on fixed profit margin per quintal (100KG.) They aim to maximize the quantity they sell. On the other hand, village level aggregators, who purchase from the farmers, play on the price. In order to maximze profit, they minimize the prices on which they are procuring from farmers. Information asymmetry in such a context plays in favour of the village level aggregators. Providing price information to farmers who sell at the farmgate can, thus, bring huge gains.
3. Long-term gains for farmers rest in the food system
Our efforts until now have focused on an immediate increase in income by enabling fair price discovery. This is a myopic strategy. We have learned that providing bundled services that holistically cover farmer needs is important for transformative impact. For instance, the non-rational use of chemicals is degrading farm soil. In the medium term, this will make farming itself unsustainable. Here, fair price discovery will not be able to save farmers. A holistic approach that encompasses farm and food systems is needed to build an environmentally and financially sustainable source of livelihood for the farmers.
4. Full stack model should be goal not starting point
We started our work by providing a bundled solution. We constructed a warehouse, operated it, offered quality inspection services, offered loans on the stored crops, bought stored crops from the farmers, aggregated them, and then sold the crops to the industry. Farmers greatly appreciated the service, since it provided them the agency to make decisions and earn good profits. But, at the organization level, we could not sustain. It did not make financial and operational sense. Our lesson was that full-stack or bundled solutions are a must for the farmers, but it should be the organization's goal and not a starting point. A good go-to-market strategy can be choosing one or two services and delivering them efficiently. Slowly as the organization matures and has more resources, we can integrate more services with an eventual goal of becoming a full- stack model.
5. Leverage past and existing solutions to build ecosystems
We often talk about the present and the future. Rarely do we put our ideas and innovation in the historical context. Agriculture is the oldest profession, and indeed before us, farmer unions, cooperatives, governments, non-profits, and companies have worked tirelessly to solve agricultural problems. These small efforts must have created an arc of impact and social change. Not knowing this arc means leaving all the possible impact on the table. We have learned this the hard way, and now as a team, we have decided to tie our work to this historical arc of impact. At Gramhal, our effort is to nudge this arc towards a positive exponential impact.
All these learnings helped the team at Gramhal to create Bolbhav. We chose mandi price information as the go-to market strategy because of two main reasons:
Past efforts - The Government of India has invested a lot of resources to build open-source platforms for disseminating price information, but these are not accessible to the farmers. By leveraging these existing platforms, price information can be easily provided to farmers at the farmgate.
Maximum short-term gain - Price information would provide immediate income gain and create a possibility of rapid adoption of our product in the community.
Thus, while keeping the focus on mandi prices (and now weather information also), we have run small pilots around government schemes, crop quality knowledge, farmer-relevant news, and connection with traders. We will continue to experiment and find pathways to deliver diverse kinds of information, to diverse sections of the agricultural community.